2025 Global Financial Crisis Stress Test: Bermuda

The Bermuda Monetary Authority (BMA) has recently published instructions for a significant data collection exercise: the 2025 Global Financial Crisis (GFC) Stress Test. This initiative requires Bermuda-regulated commercial long-term (Class C, D, and E insurers) to assess their sensitivity and resilience to a severe economic crisis similar to the 2008 GFC. Submissions are required by mid-June 2025.

For insurers operating in Bermuda, understanding the scope, requirements, and implications of this stress test is crucial for ensuring compliance and effectively navigating the process.

Purpose and Scope of the Stress Test

The BMA's objective is to gather market-wide information on the sensitivity of Bermuda's commercial long-term reinsurers to a severe market event. This analysis will complement the regular stress tests already performed by these insurers as part of their annual filings. We must highlight that the BMA has stated that this exercise is not used to set